By on January 24, 2016

China’s finance minister said Saturday that the government will end green car subsidies by 2021 and let its market dictate whether EVs or plug-in hybrid can sell on their own in the country, Reuters reported.

Lou Jiwei told reporters that the government would cut subsidies by 20 percent over the next two years, by 40 percent before 2020 and eventually end subsidies altogether by 2021, according to the report.

China surpassed the U.S. last year in electric car sales, in part because of the government’s aggressive support. Few electric cars made in China are available outside the country, however its expected that Cadillac will build in China and sell in the U.S. a plug-in version of its CT6 sedan.

Lou said that China should consider a credit policy similar to a system in the U.S. Automakers in the U.S. can acquire and sell credits to other automakers based on emissions data.

“Credit trading is the most effective way to ensure government neutrality on the technology’s development. The market should be able to choose the technical route,” Lou said, according to Reuters.

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10 Comments on “China Firm On Cutting Green Car Subsidies By 2021...”

  • avatar

    “China’s finance minister said Saturday that the government will end green car subsidies by 2021 and let its market dictate whether EVs or plug-in hybrid can sell on their own in the country”

    Sounds more “capitalist” than what’s going on in The United States of Socialism.

    We were told decades ago that we’d have used up all the world’s oil by now. Turns out that because of technological advances – it’s more plentiful than ever.

    The death of the fossil fuel I.C.E. will come not because of depletion of fossil fuels, but because a handful of people wanted to get rich by taxing and regulating them into extinction. The poor can’t afford an EV without taking dramatic sacrifices of vehicle size. The poor make the most use of fossil fuel energy because it is cheap, plentiful and ubiquitous – even though detrimental to their health.

    I’m in the market right now to replace Mom’s 2009 STS AWD 3.6-L with either a CTS 2.0 or an XTS 3.6-L.

    The XTS takes regular gasoline while the 2.0-L requires Premium.

    The XTS costs LESS than the CTS (similarly equipped).

    The XTS offers more interior space for less money than the CTS.

    Unfortunately the CT6 hasn’t gotten here yet and the Chinese built Hybrid CT6 won’t be available for much longer.

    I think I’ll go with the XTS. It makes more sense. she doesn’t need all that backseat stuff. Only problem is – getting it in RED PASSION since GM barely makes any color options and their lots are flooded with White, Black and Grey.

    Cadillac has aggressive discounts on the CTS (starting at $2500) because despite all the praise heaped onto it by “the professional car reviewers” people would RATHER take their money to Mercedes Benz and BMW or Audi.

  • avatar

    Problem is China has an air pollution problem which the free market isn’t going to fix.

  • avatar

    China needs a tailpipe emissions inspection regime way more than it needs hybrids. Some of those old clunkers with bad injectors and leaky gaskets spew some hideous chemicals.

    Just going to modern ICEs over what they’re using currently would be an air quality improvement on its own.

    • 0 avatar

      Trying to wrap my head around all these old clunkers you speak of. China passed the US in 2009 in annual vehicle sales, so most of the vehicles already have fuel injection, the vast majority produced in JVs.

      Plus you can google China emission standards:

      Not sure that a 25 year old view of China struggling around in rickety old two-stroke rickshaws, which is the vision your words put in my mind, is close to reality.

      If you want to talk hundreds, literally, of coal power plants without much pollution control, I could understand that. Plus a load of older diesel trucks.

  • avatar

    Actually, I think some US subsidies for EVs will be running out before then. To be perfectly honest, given the battery and charging technology that’s in the pipeline, I don’t think they’ll need subsidies in 2021. New battery tech is in pilot production now and will be in full production in the early 2020’s.

    At the same time, get rid of oil subsidies. If we have so much, why pay subsides for drilling.

  • avatar
    Big Al from Oz

    I believe there never should of been any subsidies, in China the USA or any nation to create an artificial market by the use of taxpayer monies.

    This is worse than technical barriers, it’s on par with the Chicken Tax.

    Subsidies reduce incentives to progress with the best possible solutions that are the most cost effective.

    Why? To placate those minorities in our society, those who make or break political parties with those extra handful of votes.

    It would of been far cheaper and of more economical value to China and the US to develop less polluting power stations, provide natural gas to all home to remove the use of oil for heating in industry.

    We need to maximise our existing technologies first.

    Leave battery power for golf carts, forklifts, laptops/tablets and cordless drills/tools.

    Why does the government not subsidise my cordless drill or laptop?

  • avatar

    China air quality is dangerously toxic in some cities and every Chinese person I know cares about the environment. This was a really dumb thing to say in China and he will soon be out of favor in the party.

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